Is investing in the top 10 coins a good strategy?

Investing in top coins as a passive investor is the easiest way to get exposure to any electronic tradeable asset like – Stocks / Crypto / Forex. Buy the ones with the top market cap and forget about it. Check back after 5 years and Voila, the base capital would have grown by a certain percentage.

This is the most time-efficient way to look at it and take a decision, but does this really work in Crypto?

Here are the market cap Rankings for the last 5 years

Rank20182019202020212022
1.BitcoinBitcoinBitcoinBitcoinBitcoin
2.RippleEthereumEthereumEthereumEthereum
3.EthereumRippleRippleLitecoinBinance Coin
4.Bitcoin CashBitcoin CashBitcoin CashRippleRipple
5.CardanoEOS NetworkLitecoinPolkadotDogecoin
6.NEM XEMLitecoinEOS NetworkBitcoin CashCardano
7.LitecoinStellarBinance CoinCardanoPolygon
8.TronBitcoin SVBitcoin SVBinance CoinTron
9.StellarTronMoneroChainlinkPolkadot
10.MIOTACardanoStellarWrapped BitcoinLitecoin
11.DashMIOTATronBitcoin SVShiba Inu
12.EOS NetworkMoneroCardanoStellarUniswap
13.MoneroBinance CoinTezosEOS NetworkAvalanche
14.NeoDashUNUS SED LEOMoneroSolana
15.QTUMNEM XEMCosmosTheta NetworkUNUS SED LEO
A Table of the top 15 coins by market cap in the last 5 years

Some observations from above

  • 30 unique coins were part of the top 15 coins over the past 5 years
  • 13 different coins made it only once to the top 15 and were never seen again.
  • Some of the coins have lost over 90% and have even been delisted from the major exchanges
  • from 2018 to today, a total of 17 coins have appeared in the top 15 and lost their spot in the top 15
  • A lot of coins made these positions in between the year and lost their steam, which will take the tally up to 50+. Like LUNA, ANC and FTT in 2022 which were even part of the top 5 at a point in time.

Conclusions from the above

If you have to buy and hold with years as your investment horizon, it’s better to stick to the top 3 or even the top 2 rather than the top 10.
The risk of doing this is a highly concentrated portfolio. Along with that, you will miss any major moves that the upcoming tokens would generate, as you would be invested in the top 3 itself, but it would be safe from a huge turnaround where some coins lose 90%+ of their value

It’s generally a bad choice to just buy and forget, especially in crypto. There has to be some level of constant(monthly, bi-monthly) monitoring, to be aware of the market and its movements. Because the moves are rapid and there is no coming back for a lot of tokens if they go through something like LUNA, Anchor or FTT.

Just taking a decision on the basis of market cap does not sound like a good strategy in terms of potential risk. There has to be some level of conviction built to hold positions in crypto for the long term.

If no conviction then there has to be monitoring to avoid major losses so that you can get out of the current position and move into some other token as per the market conditions.

Athena Strategies built by sypto tracks top coins and market movements 24×7 to protect you from any major downside and be part of a potentially huge upside. With no forced rebalances and few trades, it is a perfect foil for someone looking to have exposure to crypto markets with less risk.

Invest better in crypto – Reads

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